What is a loan agreement?
A loan agreement is a written contract that records the amount lent, the interest rate (if any), and how and when the loan must be repaid.
Business & Startups
Loan Agreement
Generate a loan agreement between a UK lender and borrower, covering repayment terms, interest, and security, consistent with the Consumer Credit Act 1974 where applicable.
- Create a personal loan agreement between family or friends
Generate a loan agreement between [Lender Name] and [Borrower Name] for a loan of [Loan Amount], covering the repayment schedule, interest rate (if any), and what happens if the borrower defaults.
- Create a business loan agreement
Generate a business loan agreement between [Lender Name] and [Borrower Company Name] for [Loan Amount], covering interest rate, repayment schedule, and any security offered over business assets.
- Create a loan agreement with a repayment schedule
Generate a loan agreement between [Lender Name] and [Borrower Name] for [Loan Amount] repayable in [Number] instalments of [Instalment Amount], including default and early repayment terms.
Loan Agreement Generator (UK)
A loan agreement is the written contract documenting the amount lent, interest rate, and repayment schedule when one party lends money to another in the UK. This free UK loan agreement generator produces agreements for personal loans between family or friends, and business loans between companies or individuals, noting that businesses regularly lending to consumers are generally regulated by the Financial Conduct Authority under the Consumer Credit Act 1974, while one-off loans between family or friends are typically outside that regime. It is designed for individuals lending to family or friends, and businesses extending credit to other businesses, who need clear, enforceable repayment terms. The generator lets you specify interest (if any), a repayment schedule or lump-sum repayment date, and what happens on default, including any security offered. Use it to protect the lender's right to repayment and avoid ambiguity about whether money was a loan or a gift.
Frequently asked questions
Do I need a written loan agreement for lending to family or friends in the UK?
It is not legally required, but strongly recommended, since a written agreement avoids disputes about whether money transferred was a loan or a gift.
Does the Consumer Credit Act 1974 apply to my loan?
If you are in the business of lending to consumers, you generally need FCA authorisation and must comply with the Consumer Credit Act 1974; informal, one-off loans between family or friends are generally exempt.
Can a loan agreement include interest?
Yes, the parties can agree an interest rate, though FCA-authorised consumer lenders must comply with additional disclosure and affordability requirements.
What should a loan agreement include?
The loan amount, interest rate (if any), repayment schedule or due date, what happens on late payment or default, and any security or guarantee provided.
What happens if a borrower does not repay a loan in the UK?
The lender can pursue the debt through negotiation, a formal letter of demand, or ultimately County Court proceedings, and a written loan agreement makes it far easier to prove the debt exists.